Electronic Signatures in Australia

Overview

With many Australian and international businesses shifting to remote working arrangements in light of the government’s COVID-19 response, companies and individuals are likely to need to sign documents without easy access to hard copies or a printer.

The good news is that, generally, under Australian law, an electronic signature is likely to be treated the same as a written signature, provided that certain requirements are met. The bad news is that these requirements are not always clear and that some documents are exempt from the legislation governing electronic signatures.

Electronic signatures (or e-signatures) are common in Australia and regularly used for business transactions. Australian laws regarding electronic transactions start from the basis that all types of electronic signatures are just as enforceable and admissible as traditional “wet” signatures, providing that they meet three conditions. They must:

1. Identify the signatory and indicate their intention to sign the relevant document or transaction;
2. Be either as reliable as appropriate for the purpose of the transaction or document to be signed; or proven in fact, either by itself or in conjunction with other evidence, to identify the signatory and their intention to sign the relevant document or transaction.
3. Show that the person to whom the signature is provided consents to the method of signing used.

Australian laws around electronic transactions are complicated by the federal nature of the country’s government. At the Commonwealth (i.e. national) level, the key legislation is the Electronic Transactions (ET) Act 1999, which applies to transactions governed by Commonwealth laws. The Electronic Transactions Regulations 2000 then set out which transactions and Commonwealth laws are exempt from the Act, and so require a traditional signature. Additionally, each State and Territory in Australia also has its own electronic transactions legislation, which broadly mirror the Commonwealth ET Act but include some specific exceptions that apply when a transaction is governed by the laws of the relevant State or Territory.

Various court cases in Australia have upheld the validity of documents signed electronically. However, the threshold for the “reliability” requirement is reasonably low. For example, the courts have upheld the use of a stylus or finger on a computer trackpad to produce a signature similar in appearance to one sent by fax. Thus, when doing business with other jurisdictions where e-signature validity may be assessed differently or for specific compliance requirements, use of certificate-based digital signatures, such as cloud signatures, should be considered as part of the workflow risk management strategy.

Australian law does not require electronic signature data to be stored only within Australia. However, if electronic signature data contains any personal information, it will fall under the requirements of Australia’s Privacy Act for disclosing personal data overseas.

Special Considerations

In Australia, there are several use cases that generally require a traditional signature. Additionally, there are several instances that require additional consideration for e-signatures legal compliance such as when transacting with public sector entities as well as specific state or territory law that may apply to certain use cases or transactions.

Transacting with public sector entities

Under the Commonwealth ET Act, if you provide an electronic signature to a Commonwealth government department or agency, the method of providing that signature must meet the department’s specific information security requirements.

The Commonwealth Corporations Act

The Corporations Act 2001 is exempt in its entirety from the provisions of the Commonwealth ET Act. This means that any provisions of the Corporations Act requiring a signature can only be satisfied using a traditional wet signature.

As a consequence, a person cannot rely on the statutory presumption in section 129(5) of the Corporations Act where a document has been electronically signed. This section provides that a person may assume a company has duly executed a document if the document appears to have been signed by either two directors of the company, a director and a company secretary of the company, or the director of a proprietary company who is the sole director and sole company secretary. This presumption will only arise where the document has been signed using a wet signature.

Australian state and territorial law

The relevant legislation in each Australian State and Territory is:

• Victoria: Electronic Transactions (Victoria) Act 2000;
• New South Wales: Electronic Transactions Act 2000;
• Queensland: Electronic Transactions (Queensland) Act 2001;
• Western Australia: Electronic Transactions Act 2011;
• South Australia: Electronic Communications Act 2000;
• Northern Territory: Electronic Transactions (Northern Territory) Act 2000;
• Tasmania: Electronic Transactions Act 2000; and
• Australian Capital Territory: Electronic Transactions Act 2001.

As with the Commonwealth ET Act, in some States and Territories regulations set out which transactions and laws are exempt from that State or Territory’s electronic transactions legislation. The particular types of exemption are different in each State or Territory.

The main regulations are:

• Victoria: Electronic Transactions (Victoria) Regulations 2010;
• New South Wales: Electronic Transactions Regulation 2017;
• Western Australia: Electronic Transactions Regulations 2012;
• South Australia: Electronic Transactions Regulations 2017;
• Northern Territory: Electronic Transactions (Northern Territory) Regulations 2001; and
• Tasmania: Electronic Transactions Regulations 2011.

Use Cases that Generally Require a Traditional Signature

The particular exemptions differ in each jurisdiction. However, in general there are five categories of transactions that are exempt:

1. Legal proceedings:
   1. The Commonwealth ET Act cannot be relied on for validation of the use of an electronic signature in relation to the practice and procedure of a court or tribunal, including all matters in relation to which rules of court may be made.
   2. The New South Wales Regulations provides that documents that must be or are permitted to be lodged, filed, signed, produced or retained in relation to legal proceedings cannot be signed or executed electronically.
   3. The Queensland Regulations provide that documents that must be or are permitted to be filed, signed, produced or retained in relation to a court or tribunal for a proceeding cannot be signed or executed electronically.
2. Personal service:
   1. In New South Wales and Queensland, documents that must be or are permitted to be served personally or by post cannot be signed or executed electronically.
   2. In South Australia, documents that must be or are permitted to be served personally cannot be signed or executed electronically. However, this exception does not apply to certain prescribed legal proceedings. Prescribed legal proceedings include proceedings in relation to:
      1. summary or indictable offences under the Summary Procedure Act 1921 (SA);
      2. the enforcement of a sentence for an offence;
      3. enforcement and recovery of fines;
      4. the issue and recovery of expiation fees;
      5. court orders of a restrictive nature made under the Summary Procedure Act 1921 (SA); or
      6. court orders made under the Intervention Orders (Prevention of Abuse) Act 2009 (SA).
   3. In Victoria, transactions that must be effected by personal service and documents that must be served personally cannot be signed or executed electronically.
   4. In Western Australia, transactions that must be effected by personal service, and information or documents that must be served personally, cannot be signed or executed electronically.
   5. In the Northern Territory, information that must be given or documents that must be served personally cannot be signed or executed electronically.
   6. In Tasmania, transactions that must be effected personally, and information or documents that must be served personally cannot be signed or executed electronically.
3. Powers of Attorney:
   1. In Western Australia, transactions, requirements or permissions in relation to creating an instrument appointing an enduring power of attorney or an attorney to manage a person’s affairs cannot be signed or executed electronically.
   2. In Tasmania, transactions in relation to the creation of an instrument appointing an enduring guardian or an attorney to manage a person’s affairs cannot be signed or executed electronically. Further, requirements or permissions in relation to enduring guardians or powers of attorney cannot be executed or signed electronically.
   3. The Northern Territory Regulations provide that transactions in relation to the creation or revocation of a power of attorney cannot be signed or executed electronically. Further, laws that require or permit a person to give, record or retain information in writing in relation to the creation or revocation of a power of attorney, or produce or sign an instrument creating or revoking a power of attorney cannot be signed or executed electronically.
4. Wills:
   1. In Victoria, transactions, requirements or permissions in relation to the creation, execution or revocation of a will, codicil or other testamentary instrument cannot be signed or executed electronically.
   2. In Western Australia, requirements or permissions in relation to the creation, execution or revocation of a will, codicil or other testamentary instrument cannot be signed or executed electronically.
   3. In Tasmania, transactions, requirements or permissions in relation to the execution or revocation of a will, codicil or other testamentary instrument cannot be signed or executed electronically.
   4. The Northern Territory Regulations provide transactions in relation to a disposition of property by, or revocation of, a will cannot be signed or executed electronically. Further, laws that require or permit a person to give, record or retain information in writing in relation to a will or revocation of a will, produce a will or revocation of a will, or signing a will or revocation of a will cannot be signed or executed electronically.
5. Witnessing:
   1. In New South Wales and South Australia, documents that must or are permitted to be verified, authenticated, attested or witnessed by or under a person’s signature who is not the author of the document cannot be signed or executed electronically. However, in South Australia, this exception does not apply to transactions in relation to the disposition of land, an interest in land or prescribed legal proceedings. Prescribed legal proceedings are discussed further above.
   2. In Queensland, documents that must be or are permitted to be attested, authenticated, verified or witnessed by a person who is not the author of the document cannot be signed or executed electronically.
   3. In Western Australia, transactions or requirements that a document must be verified, authenticated, attested or witnessed under a person’s signature who is not the author of the document cannot be signed or executed electronically.

Temporary Measures in Response to COVID-19

In response to COVID-19, the Commonwealth and most Australian States and Territories have introduced temporary measures to expand electronic signature use cases.

Commonwealth

Under the new temporary rules set out in the Corporations (Coronavirus Economic Response) Determination (No. 3) 2020 (Cth) (Determination), Australian companies can now execute documents under section 127(1) of the Corporations Act 2001 (Cth) if signed by:

• two directors of the company,
• a director and company secretary, or
• a sole director of a proprietary company who is also the company secretary,

Additionally, each signatory must:

1. sign a full copy or counterpart of the document in a physical form (other than the signatures of any other persons signing the document), or
2. use a reliable and appropriate electronic method to identify themselves and to indicate their intention to execute the document. Examples of electronic methods used to identify a signatory include:
   • pasting an electronic scanned copy of the signatory’s signature into a document,
   • signing a PDF on a mobile device using a stylus or finger, or
   • using a digital signature that incorporates cryptographic authentication

Australian States and Territories

Many Australian States and Territories have also introduced temporary measures to permit documents such as affidavits, deeds, and wills to be witnessed remotely by audio-visual link. It is important to note that the types of documents that can be witnessed remotely as well as expiration dates for the temporary measures differ between each State and Territory.

External Resources:

https://www.lexology.com/
Davis Collison - https://dcc.com/
Source helpx.adobe.com
Published, January 2021
Legal Notices:
https://helpx.adobe.com/legal/legal-notices.html

SigniFlow recommends Adobe Acrobat Reader to validate digital signatures

Disclaimer:
The information in this website is provided for general informational purposes only. No information contained in this website should be construed as legal advice from SigniFlow or any individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this website should act or refrain from acting on the basis of any information included in, or accessible through, this website without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue.